Had quotes for $20,000 not including materials. 

Also, if your short-term rentals qualify under material participation rules, you can still use depreciation benefits to offset W-2 income regardless of whether the property is in an LLC or not.When you own in both states, you don’t necessarily need a separate LLC for each property.

.: Quote from @Natalie Kolodij: Quote from @Rohullah Sharifi: If you are actively engaged in the real estate business—such as rental property ownership, real estate investment, and property management—and you meet the material participation test, your activities may qualify you as a real estate professional for tax purposes.

The main point still stands, though: if you qualify as a REP or materially participate in STRs, those deductions can be powerful.

If the structure and materials aren’t severely damaged, that approach could save you a ton and preserve your equity.

Would that not fall under the same category of “material participation” in day-to-day operations?

It also makes partnerships, cost segregation, and passive loss planning much cleaner.Depreciation & Strategic Tax PlanningYou’ll want a CPA who’s thinking in terms of grouping elections, material participation, and maximizing depreciation through cost seg.

That said, if you don’t materially participate, the losses stay passive and won’t offset W-2 income.

Keep detailed records of all materials, labor, and contractor invoices.Trusted Team: Even before making an offer, having a CPA who specializes in real estate investors review your numbers can help structure deals efficiently and anticipate tax implications.

A couple of investors I know stress the importance of locking in material costs early and keeping a close eye on timelines, since delays eat into your financing.Since I also work with a lending company, I see a lot of people scaling through new builds, and it’s a strategy that works well if you’re disciplined.